The Big Board Isn't So Big Anymore

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Trading space, traders and Big Board staffing levels are all trending downward as electronic trading and organizational changes take root.

The exchange itself is closing one of its five trading floors-the New Room-and laying off more than 500 employees and full-time consultants. Trading houses operating on the Big Board floor are also predicting downsizings.

Van der Moolen Specialists, for instance, told its shareholders recently it plans to automate much of its trading as the NYSE moves to a hybrid electronic-manual model. Van der Moolen's decision will mean "a reduction in the number of full-time equivalents," executives there noted.

"Equivalents" at competitor LaBranche & Co. are in danger of losing their jobs too, according to chief executive Michael LaBranche.

"As new technology is introduced," LaBranche told analysts recently, "there will probably be further reductions in personnel on our trading floors. How much of a reduction, I don't know. But much will depend on volumes." LaBranche has cut its work force in half since 2001, the exec said

With all those traders streaming out the NYSE's door, there is apparently less need for space on the floor. The closing of the New Room pushes traders from specialist Bear Wagner and about 33 floor brokerages into the rest of the building.

Many of those traders at Bear Wagner may not be around for too much longer anyway. Traders Magazine has learned that Bear Stearns, Bear Wagner's majority owner, is in the process of buying out the partners. At presstime, the deal had not yet been approved.